Rich people in the US, have built business empires taking on debt.
But, normal retail folks like you and me can ruin our financial well being by taking debt unnecessarily.
So it makes sense to understand the difference between good and bad debt: 👇
1. Robert Kiyosaki puts it well:
- Rich people build assets (Assets=put money into your pocket)
- Example: when Jared Kushner buys Real Estate, he will rent/sell it. This is a 'cash flow' for him.
- Unfortunately, when normal folks buy Real Estate, they create a liability.
2. Normal folks are champions at creating liabilities:
- Eg. buy an i-phone on EMI.
- Buy a house on a massive loan.
- If you max out 1 credit card, time to apply for a new one.
With endless WANTS, Discounts/Cash-backs/EMIs become tools to push demand.
3. Rich folks are champions at building assets: they take debt, create an asset (eg. a Real Estate company) and take tax breaks on it.
More over, they build a brand around it (example Trump is a brand, which one could argue is pretty much built on debt).
4. Great marketing makes us believe that DEBT is necessary.
Example:
- You don't need a credit card to boost up your CIBIL.
- If you are someone with a good credit history, your CIBIL will be high.
- But almost every research is done by lending firms: eg
5. Summary: to get rich, we need to develop the right mindset.
This involves understanding why you NEED debt in the first place?
And, it is definitely not to buy a new shiny phone (if that is a liability).
So how would you define good debt? (Comment below)
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Is this madness or is there some mega-trend at play?
Let's understand the NFT craze: 👇👇
1) NFT?
- It is an asset on a blockchain network (eg. Ethereum network)
- B/c the data can be tracked, it has a clear proof of ownership.
- And, like the Monalisa painting it holds no value if it is broken down (hence, it is non-fungible)
- Example:
Jack Dorsey's Tweet
2) Just because you 'own' a NFT does not mean that you get to do whatever you like with it:
- For example, you can't change Jack's Tweet above even if you are the owner.
- Or hide it from people.
If you are unhappy with your job, it is time to do something about it.
Where do you start?
And -- more importantly -- how to build more options?
A thread:
👇👇
1/A very quick story about me:
- I started my career working with a non-profit organisation.
- While the work was great, I was just making INR 10K a month.
- This was bad, really bad. I could not even meet my everyday expenses.
My first step was to cultivate more options.
2/I had done well on the GMAT in college, so I started a small side tutoring business.
Every month, I used to get 1-2 private clients.
This 'side gig' helped me make 5X the money, I was making from my regular job.